Gold Price News: Gold Gains As US Dollar, Treasury Yields Weaken

Gold put in a relatively strong performance on Thursday, gaining around $30 an ounce after the US dollar and treasury yields fell.

Prices started the day at around $2,300 an ounce and quickly strengthened through the morning session. The gains continued through the afternoon, taking gold briefly above $2,330 an ounce – more than recouping Wednesday’s losses.

The US dollar fell against other major currencies on Thursday, giving up the previous day’s gains. A weaker dollar tends to support dollar-denominated gold prices as it makes the yellow metal cheaper for buyers in other currencies, boosting demand.

Yields on US 10-year treasuries also fell on Thursday, contributing to a bullish backdrop for gold.

However, technical elements may have come into play on Thursday, as gold prices notably bounced off the $2,300 an ounce level – a significant price on the charts, as this area previously attracted buy-side support after previous falls in early May and again in the second week of June.

A further potentially supportive element came from data from the World Gold Council this week showing that open interest in gold futures contracts on exchanges increased slightly in the week ending June 21, having fallen for the previous four consecutive weeks.

Open interest on Comex increased to $105.1 billion from $103.1 billion the previous week, while open interest on the Shanghai Futures Exchange increased to $31.1 billion from $29 billion the previous week, the figures showed: Gold Open Interest Chart 2021 | World Gold Council

US durable goods orders and GDP figures for Q1 released Thursday showed little change compared with market expectations, providing little direction for gold.

Looking ahead, eyes will be on Friday’s US Core PCE Price Index for May, as the markets look for signals on upcoming interest rate changes by the US Fed.